Advertisers are supposedly paying insanely high rates to get their ads on Snapchat

In January, Snapchat launched a news curation tool, Discover,
with big-name partners like CNN, ESPN, and Vice. And apparently
the publishers and their ad partners are loving Snapchat.

Discover allows publishers to curate five of the day’s most
popular stories in a mobile-friendly format and sell accompanying
video ads. If a publisher sells a campaign, they get to keep 70%
of the revenue. If Snapchat sells the campaign, revenue is split
50-50.

Recode's Kurt Wagner dug up a little dirt on
Snapchat's rate card. His industry sources say advertisers
are paying $100 CPMs — twice as much as most video ad products
can command online, and an absurd amount more than publishers can
command for banner ads.

"CPM" is ad-industry shorthand for the cost per 1,000 ads shown.
With Snapchat Discover, CPMs are determined by each publisher,
Wagner says, so that $100 isn't set in stone. Advertisers are
buying into a guaranteed number of ad impressions or views. (The
11 launch publishers on the platform are CNN, Comedy Central,
Cosmopolitan, Daily Mail, ESPN, Food Network, National
Geographic, People, Vice, Yahoo! News and Warner Music.)

"Industry sources say that on average, publishers are getting
around 10 cents a view for their ads, which are seen anywhere
from 500,000 times a day to a million times a day," Wagner
writes. "That means publishers are able to command $50,000 to
$100,000 a day for their stuff." He notes that ESPN has been able
to sell ads across Snapchat and its web properties for $100,000
per day.

Digiday previously reported that advertisers were paying about
15¢ per view on Snapchat Discover. DailyMail's US CEO Jon
Steinberg, who says he's loving the Snapchat Discover
partnership, told Digiday he was happy to speak with advertisers
about $50,000 per day spends on the platform.

But fill rates don't seem to be particularly high for Snapchat,
although ads may be few and far between on purpose to create a
better user experience. If you check out a publisher's portal on
Discover, it's pretty hard to find an ad. It's also unclear why
Snapchat didn't launch Discover in the fourth quarter, when
advertisers typically have a lot of their annual budget left to
experiment with new properties and products. The first quarter,
and January, in particular, is typically planning mode — not
spending mode — for ad agencies.

But from the sound of things, advertisers and publishers are
beaming over the new revenue and promotional opportunities
Snapchat's experimental platform is bringing.